Palantir just posted the best quarter in its public history — 84.7% year-over-year revenue growth, 46.2% operating margins, $1.63 billion in three months. Its Maven Smart System coordinated thirteen thousand airstrikes over Iran in thirty-eight days. The Pentagon adopted it as the backbone of America's military AI. The stock? Down 44% from its $207 peak. Down 31% year-to-date right now at $115.70. Something's broken here, and it isn't the business.
Let that sink in. The only profitable, hyper-growth AI company in the entire market is trading like it's a meme stock that peaked during a pandemic. Meanwhile C3.ai — revenue declining fifty-two percent — is somehow holding a higher revenue multiple on a growth basis. The market doesn't understand what's happening inside Palantir, and that mispricing is your opportunity.
Here's what happened. During Operation Epic Fury in May 2026, the Maven Smart System didn't just assist targeting — it ran the entire kill chain. Every one of those 13,000 strikes was routed through Palantir's AIP. At peak usage, the system was processing twenty billion AI tokens per day. Unclassified workload volume up 38%. Classified workload volume up 89%. User count is doubling every six months and probably sits around 80,000 right now. The contract ceiling alone is above a billion dollars, and that's just one program.
Revenue tells the story better than any pitch deck ever could. FY2023: $2.2 billion. FY2024: $2.9 billion, up 28.8%. FY2025: $4.5 billion, up 56.2%. FY2026 guidance: $7.7 billion, up 71%. That's an acceleration curve, not a deceleration. Net income went from $214 million in Q1 2025 to $871 million in Q1 2026 — four times in twelve months. Free cash flow hit $2.1 billion last year. They're sitting on $8.03 billion in cash with just $212 million in debt. Debt-free at a $277 billion market cap. Read that again.
You know what people call this? Overvalued. At 130x trailing earnings. Let's talk about what they're comparing it to. Snowflake at $5 billion in revenue hasn't figured out profitability yet. C3.ai is actively shrinking. OpenAI burns billions monthly on inference with no margin path. Palantir has 84.1% gross margins trailing twelve months — up from 80.6% in FY2023. Operating margins went from 5.4% to 46.2% in three years. That's a company finding its terminal operating model and the market still hasn't priced it in.
The forward PE is 55.6x, which sounds a lot more reasonable when your earnings are expected to quadruple over the next two fiscal cycles. Twenty-seven analysts covering this thing have a consensus BUY with a mean target of $182.75 — that's 58% upside from where you're reading this. The bear case needs the company to actually disappoint, not just be expensive in hindsight.
Then there's yesterday. June 29, 2026. Palantir and Nvidia announced a partnership bringing Nemotron AI models into secure government environments. Jensen Huang himself talked about strengthening America's leadership in AI. When the guy who sells pickaxes in every gold rush partners exclusively with you for the government lane, that's not a nice-to-have. That's infrastructure. That's the moat getting deeper every single quarter.
International expansion is barely started. The UK Ministry of Defence deal. NATO allies adopting Maven across the alliance. European defense spending surging to Cold War levels. Palantir is the only Western company with a platform proven in combat at this scale. You think France is going to build military AI from scratch when there's one that just ran 13,000 strikes over Iran? They're buying the battle-tested one.
| Metric | FY2023 | FY2024 | FY2025 | FY2026E |
|---|---|---|---|---|
| Revenue | $2.23B | $2.87B | $4.48B | $7.66B |
| Revenue Growth | -- | 28.8% | 56.2% | 71.0% |
| Gross Margin | 80.6% | -- | 82.5% | 84.1% TTM |
| Operating Margin | 5.4% | -- | 38.7% | 46.2% TTM |
| Cash Position | -- | -- | $8.03B | $8.03B |
| Free Cash Flow | -- | -- | $2.1B | -- |
The bears aren't entirely wrong. 130x trailing earnings is objectively a lot. Government concentration is real — one bad appropriations cycle could slow the top line. Stock-based compensation hit $684 million in FY2025, which dilutes you whether they call it an expense or not. The 52-week low is $106.37 and we're at $115.70, so no bargain-basement floor here either.
But here's what the bears miss. The Maven workloads are sticky in a way no enterprise SaaS contract ever is. You don't rip out the kill chain system that just won a war. You add to it. You expand it. You make it the default for every allied force on the planet. Palantir isn't selling software anymore. It's selling the operating system of Western military power. That's not a multiple compression story. That's a multiple expansion story, and we're probably only a year or two into it.
The market is pricing Palantir like it peaked. The data says it's just getting started.
Disclosure: The Signal holds no position in PLTR. Positions may change. This is not financial advice.
